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Rates on US Treasury bills rise at weekly auction

WASHINGTON – Interest rates on short-term Treasury bills rose in Monday's auction, with three-month bills rising to their highest level in three weeks.

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The Treasury Department auctioned $42 billion in three-month bills at a discount rate of 0.310 percent, up from 0.250 percent last week. Another $36 billion in six-month bills was auctioned at a discount rate of 0.490 percent, up from 0.420 percent last week.

The three-month rate was the highest since three-month bills averaged 0.375 percent three weeks ago on Sept. 12. The six-month rate was the highest since those bills averaged 0.500 percent on Sept. 19.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,992.16, while a six-month bill sold for $9,975.23. That would equal an annualized rate of 0.315 percent for the three-month bills and 0.498 percent for the six-month bills.

Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, edged down to 0.59 percent last week from 0.60 percent the previous week.